International law actually consists of a web of different types of laws.
Private International Law – National Laws
As to individuals and legal entities, national laws apply to transactions involving cross-border activities. National laws of one country could conflict with those of another, leaving the individuals and legal entities conducting cross-border activities in peril of complying with conflicting mandatory laws governing a certain activity. Such “conflicts of law” require outsourcing participants to identify how their activities are regulated and to manage their compliance.
Public International Law
In addition, public international law consists of treaties, conventions and other agreements among nation states, and under which individuals and nationals of such nation states might have no direct rights or remedies except to the extent the rules are implemented in local legislation. Outsourcing participants need to understand how such public international law might create rights for them in issues affecting the legality, validity, binding character and enforceability of outsourcing contracts.
Comparative Law
“Comparative law” consists of the study of how different legal regimes define rights, remedies and compliance requirements to the same situation. Where two laws create a different outcome (such as one permitting and the other prohibiting a particular activity), there is a conflict of laws. In many cases, there is no conflict. Instead, there can be a layering of different rules to that activity that result in additional compliance costs and possible additional disclosures and reporting requirements.
Decisionmaking Process as Affected by International Law
By selecting appropriate jurisdictions for establishment of operations and conducting international trade in services, outsourcing service providers have significant discretion over the nature of the laws and regulations that will apply to their transborder activities. Enterprise customers need to be informed about differences in the application of laws, such as intellectual property and criminal laws relating to economic torts, in order properly to evaluate, assume and mitigate cross-border legal risks.
